A recent best practice for mobile banking and an innovative application to engage clients is from New York based One Financial Holdings. It developed Bee, a mobile app that targets the lower-income, underbanked populations of the New York metro area. The closure of 93% of bank branches in New York have affected the demographic with incomes below the national median, leaving them without easy access to bank services. Lacking branches to deposit and cash checks, consumers have been buying prepaid cards from drugstores and loading that money onto a mobile platform. Bee takes out that middleman.
Bee is a totally mobile replacement for the traditional checking account–users can deposit cash at Bee kiosks, deposit checks online, setup direct deposits, pay bills, mail checks, and get cash from ATMs. Fees are minimal–a $5.95 monthly access fee, a 1% service charge to immediately access funds from a deposited check, and $2.00 for ATMs after two free withdrawals per month.
Brooklyn-based Community Federal Savings Bank has partnered with One Financial to be the repository for the Bee customers funds, and to issue and service the prepaid Bee Visa cards. The card issuance agreement is online and uses e-signatures, continuing the online, paperless, branchless experience.
Mobile banking apps ultimately require a real, FDIC-insured bank to manage the actual money. The opportunities to partner with these tech companies are growing as both the underbanked and millennials are eschewing old-school accounts for the smart-phone based banking models.